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Property prices are perhaps the most influential factor while making a real estate investment decision. At this stage, Dubai's property market presents the right conditions for buyers, investors and renters alike. Compared to Q2 2019, in Q3 2019, the average price per square foot declined by 8 per cent for apartments and 6.6 per cent for villas across the board. However, the decline is softening, and we believe that the market is bottoming out. The declining prices have prompted many to take advantage of market conditions and make their first property investment in Dubai. In 2018, nearly 66 per cent of the total investors in Dubai's real estate were first time buyers; and we expect that this trend will continue in 2019. We are also witnessing a trend where long-term renters are instead considering buying their own home in the Emirate. Those who invest now are sure to benefit in terms of long-term returns once there is an uptick in the market in the coming years.
Today, investors and buyers looking at Dubai's real estate landscape are spoilt for choice. From off-plan projects to ready-to-move-in units, from gated communities to exquisite branded residences, the market offers unique products that suit different needs. It is also an excellent time for buyers who are looking for luxury real estate as Dubai is set to overtake New York as the global branded residences capital by the end of the year, with 23 existing projects and another 22 in the pipeline. At Damac, we have always believed that creating a diverse range of living experiences is the key to success in a market such as Dubai. From Ghalia, our first Shariah-compliant project, to Damac Hills, our master community that caters to residents' holistic lifestyle needs, our projects have been inspired by the different cultural needs and aspirations of buyers and investors.
Dubai has always been a preferred destination for those who are looking at property as an investment. Despite the decline in prices, at 7 per cent, average rental returns of Dubai in the first half of 2019 remain stronger than in most big cities around the world. Besides long-term returns on investment, Dubai's real estate landscape offers multiple ways to make money from your investments. Compared to long-term rentals, holiday homes offer up to 25 per cent more returns to investors. As per a recent report by Knight Frank, the holiday home market of Dubai accounts for two per cent of its total households, which is the highest in proportion, compared to other big cities.
To encourage mortgage-based home purchases, the UAE Central Bank recently instructed banks and other finance providers to reduce early settlement fees to a maximum of 1 per cent or Dh10,000, whichever is less, for borrowers who want to exit their mortgage early. The UAE Central Bank also scrapped the 70-year age limit for the last mortgage repayment. These reforms will bring more flexibility for those who wish to buy a property through financing. Buying a home is a big decision that involves a complex emotional and logical reasoning. Whether you're an investor looking for returns or a buyer in search of your dream home, Dubai will never disappoint. However, it's all about taking the right decision at the right time.
Ali Sajwani is general manager operations at Damac Properties. Views expressed here are his own and do not reflect the newspaper's policy.
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